Buffalo Union Furnace Co. v. United States Shipping Board Emergency Fleet Corp.
Buffalo Union Furnace Co. v. United States Shipping Board Emergency Fleet Corp.
Opinion of the Court
On June 12, 1918, the defendant, United States Shipping Board Emergency Fleet Corporation, gave plaintiff an order for delivery of 1,250 tons of pig iron at specified prices and terms of delivery. The order was accepted and plaintiff began the performance of the contract. Afterwards all of the pig iron was delivered, except 395.54 tons, and payment made for the quantity delivered. On January 13, 1919, defendant canceled the contract, and upon failure to make adjustment to the plaintiff this action was brought to recover the balance due on account of the undelivered iron.
The defendant contends preliminarily, first, that the action is in fact against the United States, and hence the court is without jurisdiction; and, second, that it does not lie, since impliedly the contract was based upon the continued requirement by the government of the iron ordered for ship construction, and that it automatically ceased when the government no longer needed it for the intended purpose, to wit, when the Armistice of November 11, 1918, became effective.
There was evidence that when the iron was ordered the defendant had contractual relations with the American Condenser Company to construct condensers for different classes of ships in course of construction for defendant by independent contractors and that the iron in question was used for condensers for such ships. It does not appear that plaintiff was apprised of the "intended use of the iron or of any existing contract with the American Condenser Company. Not all the iron was used to construct condensers, some being shipped by defendant to Dollar & Co., a concern engaged in shipping on the Pacific Ocean. The significance of the diversion to the latter of a part of the
“Indeed, we cannot think the doctrine new except in phraseology and application; for it is elementary that among the ways in which any contract*675 ends and is dissolved is the cessation of existence of some thing, condition, or state of things, upon the continued existence of which the contract was known to depend, provided such cessation of existence arises without fault in either contracting party.” %
In Texas Co. v. Hogarth Shipping Co. (D. C.) 265 Fed. 375, Judge Hough had previously said:
“Wars, and the demands and destructions of war, do not change the law in one sense; hut in another they do, by multiplying and enforcing circumstances showing the need of change — of modernization. Without war, there had come to be recognized (inter alia) two well-known grounds of dissolution by impossibility — destruction of subject-matter without any one’s fault, and failure of mutually contemplated means of performance. Under these heads the Great War only furnished innumerable instances and applications.” Certiorari granted by Supreme Court, 254 U. S. 625, 41 Sup. Ct. 15, 65 L. Ed. 445.
These cases, it is true, were in admiralty, wherein the doctrine of “frustration of purpose” is not infrequently applied, but its application is not limited to maritime litigation. 13 Corpus Juris, 641. There are numerous adjudications where parties were excused from performance upon the presentation of conditions rendering full performance by either party impossible and discharging both parties from any obligations thereunder. See Edward Maurer Co. v. Tubeless Tire Co. (D. C.) 272 Fed. 990; Berthoud v. Schweder, 31 Times L. R. 215 Eng. 404; Stewart v. Stone, 127 N. Y. 500, 28 N. E. 595, 14 L. R. A. 215. It is therefore held herein that at the time of making the contract in question there was an implied condition by which the defendant Shipping Board was relieved from performance with respect to any undelivered iron, when hostilities of war ceased and its complete fulfillment depended upon the existence of the conditions which rendered it necessary to contract for the material.
Plaintiff’s contention that some of the material was shipped by the government to Dollar & Co., who may have had connections with Japanese government’s activities in- shipbuilding, or that ships built by defendant are now engaged transporting freight from which damages may be paid, is not believed of material importance. It does not overcome the presumption that the pig iron for condensers was to be used for the purposes and necessities of the war and in contemplation of the acts of Congress creating the defendant corporation or the implied termination of the contract when the war ceased.
The complaint is dismissed, with costs.
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Reference
- Full Case Name
- BUFFALO UNION FURNACE CO. v. UNITED STATES SHIPPING BOARD EMERGENCY FLEET CORPORATION
- Status
- Published